The Blog

Who’s at fault?

A lot of parties are being named in these CPVC fire sprinkler lawsuits. But under what theory would any of these potential defendants be responsible for damages or for any repairs?

While much will depend on the actual circumstances surrounding each claim, historically, a condominium purchaser would look to either the common law or statutory warranty of fitness and merchantability for relief. The allegations would be that the unit does not meet appropriate building codes or that the construction was not completed in a workmanlike fashion, or maybe that the plans and specifications were not fit for their intended use, or simply that the premises are unfit and uninhabitable.

The choice between common law and statutory warranties is not mutually exclusive. The benefits and burdens do stand in contrast though, in that the statutory warranty runs for a finite period from an objective date in time while the common law warranty does not. The statutory warranty cannot be waived or disclaimed by contract while the common law warranty may be. The statutory warranty runs from the developer, the contractor and all subcontractors and suppliers while the common law warranty extends only from the developer. Furthermore, unlike the common law warranty, the statutory warranty is not restricted to first purchasers but inures to the benefit of each owner and his or her successors.

In addition to the common law and statutory warranties, there are other alternative causes of action available to condominium unit purchasers who find themselves struggling with property defects. One is negligence. In such actions, the statute of limitations is usually longer and more flexible, allowing more time for discovery of any defect. Additionally, an action in negligence may attach to design professionals such as architects and engineers, against whom a warranty action would not customarily stand, given their lack of privity of contract with the purchaser. The design professional will be held to a duty of reasonable care as to design.

Interestingly, while an action in negligence usually cannot be maintained against a contractor after the contractor has completed its work, turned the unit over to the owner, and the unit has been accepted by the owner, courts have recognized an exception where the defect is latent and cannot be discovered by a reasonably careful inspection. The statute of limitations for such latent defects does not begin to run until the defect is discovered. This has the practical effect of extending the life of a defect claim (where the warranty claim may have lapsed) by allowing a negligence action to pick up where warranty is no longer available. However, actions for latent defects generally must be commenced within ten years after the date of actual possession by the owner, or the potential claim expires. A word of caution, however – the statute of limitations for such negligence actions involving latent defects begins to run when the defect is discovered or should have been discovered with reasonable diligence. This can shorten the life of a negligence claim considerably.

While there may be a lot of finger-pointing, one thing is clear – there are several avenues a claimant can pursue for relief. And likewise, there are a number of defendants available to counter any of these claims. Naming a party in a suit is easy; proving that that party is legally responsible is significantly more difficult.